Italian five-year yields climbed as much as 21 basis points, the most in a month, to 3.55%. Italian 10-year yields extended their first quarterly increase since June as demand fell when the Treasury sold 6.91 billion euros ($8.84 billion) of debt at an auction today. Democratic Party leader Pier Luigi Bersani said there was no possibility of a broad coalition to end the deadlock caused by last month’s elections.
Spanish bonds fell with their Italian counterparts, pushing the 10-year yield up 14 basis points to 5.07%. The yield on benchmark 10-year German bunds fell seven basis points to 1.28% as investors sought Europe’s safest fixed-income assets.
Spain revised up the first estimate of its 2012 budget deficit after Eurostat requested it to change the way it computes tax claims. The budget shortfall was 6.98% of gross domestic product last year instead of the previously estimated 6.74%, Deputy Budget Minister Marta Fernandez Curras told reporters in Madrid today.
The cost of insuring against losses on senior European bank bonds climbed for a ninth day, with the Market iTraxx Financial index of credit-default swaps linked to 25 banks and insurers climbing 12 basis points to 202.
U.S. government securities rose for a third day. Treasury 10-year note yields slid six basis points to 1.85%, after touching 1.83%, the lowest since March 4.
Natural gas, gas oil and live cattle climbed at least 1% to pace gains among commodities in the S&P GSCI Index, while hogs, lead and coffee led declines.
Gold for immediate delivery reversed earlier losses to climb 0.5% to $1,605.10 an ounce. Silver declined 0.5%. West Texas Intermediate oil slipped 0.3% to $96.08 a barrel, the first decline in four days.
The MSCI Emerging Markets Index added 0.2% for a third straight gain. The Philippine Stock Exchange Index rallied 2.7% to a record after Fitch Ratings gave the country its first investment-grade debt rating. The Hang Seng China Enterprises Index of mainland companies listed in Hong Kong increased 1% as Chinese banks reported lower bad-loan ratios.
Brazil’s real rose for the first time in seven days after the central bank announced an offering of foreign-exchange swaps to limit the currency’s decline. The real appreciated 0.2% to 2.0134 per dollar. The central bank announced an auction of 20,000 currency swap contracts in the first offering of its kind since Jan. 28.